Mexico, despite its sunny regions, has surprisingly low solar power usage compared to countries like Germany, which has one-eighth of the solar capacity despite receiving less sunlight and having fewer people.
While Germany’s government incentives played a role, Mexico’s solar market remains in its early stages. Customers are unfamiliar with solar technology, and the market is fragmented.
Seeing an opportunity in this, entrepreneurs Edoardo Dellepiane and Raffaele Sertorio, formerly of CloudKitchens, ventured into the Mexican solar industry. In March 2022, after leaving CloudKitchens, they decided to delve into climate tech, focusing on solar power due to Mexico’s intense sunlight and high electricity rates.
Despite the advantageous circumstances, solar uptake in Mexico trailed, particularly among residential and small commercial clients. They observed that many small installers lacked experience, resulting in uneven and sometimes dysfunctional installations.
In response to these obstacles, Dellepiane and Sertorio established Niko, a solar installation firm headquartered in Mexico City. Niko recently secured a $3.3 million seed funding round led by Picus Capital and 468 Capital, aiming to offer hassle-free solar solutions to residential and small commercial customers.
Niko’s approach includes no upfront costs for customers, guaranteed utility bill savings, and free panel removal if customers aren’t satisfied. While the sales cycle in solar tends to be long in Mexico, Niko maintains customer relationships through constant follow-ups via email, SMS, or WhatsApp.
In Mexico, few banks offer loans for small-scale solar installations, with lengthy approval times and high-interest rates. Niko currently handles all financing in-house, offering residential customers savings between 20-40% on utility bills, and small commercial customers up to 20%.
Looking ahead, Niko plans to expand its services to include home electrification projects like batteries, EV chargers, and water heaters. The company targets large corporations, banks, and property managers to increase its customer base and improve Mexico’s solar market challenges. If successful, Niko could significantly impact solar adoption and sustainability efforts in Mexico.
